Study: Retailers behind in EMV, does it matter?

Many retailers are lagging in their EMV adoption efforts, and many consumers may not care that much.



In February 2016, credit card comparison website CardHub conducted an online survey of 1,000 consumers, and also surveyed 55 major retailers by phone in February-March 2016. Looking at the retailer survey, 42% of respondents have not updated terminals in any of their stores. Somewhat surprisingly, this figure is essentially the same (43%) among retailers who have experienced data breaches in the last five years.



Sixty percent of retail respondents who previously said they would complete equipment upgrades by the Oct. 1, 2015 EMV deadline had done so at the time of the survey.



Of the retailers surveyed, 16 (29%) were 100% EMV-compliant as of March 2016: Wal-Mart, Target, The Home Depot. Walgreens, CVS/Caremark, Best Buy, Macy’s, Rite Aid, H-E-B (expected by June),



Kohl’s. Dollar General, Gap, Nordstrom, Menards, Trader Joe’s. and Michael’s. Target, The Home Depot, CVS/Caremark, and Michael’s have experienced a data breach in the last five years.



Another 23 (42%) were 0% EMV-compliant: Publix, Kmart, Ahold USA/Royal Ahold, TJX, Albertson’s, Food Lion, Pizza Hut, Meijer, Wakefern/Shoprite, BJ’s Wholesale Club, Whole Foods Market, J.C. Penney, 7-Eleven, Bed, Bath & Beyond, Aldi, Ace Hardware, Family Dollar Stores, Bi-Lo, Wendy’s, Staples, Burger King, BeBe, and Neiman Marcus. Kmart, Albertsons, Staples, BeBe and Neiman Marcus have experienced a breach in the past five years, while Wendy’s is investigating a potential incident.



However, results of the consumer survey showed 56% of respondents don’t care if a retailer’s payment terminal is chip-enabled. Another 42% say it is not a deciding factor. Only 2% of consumers won’t shop at a retailer if they lack chip-enabled payment terminals.



Part of this low level of EMV concern among shoppers may be because 41% of consumers do not have (28%) or don’t know if they have (13%) a chip-enabled payment card. And 50% of respondents don’t know whether chip-based payment cards offer better fraud protection than non-chip-enabled cards, while 12% definitely believe they do not protect better against fraudulent transactions.



Forty percent of consumers never execute a transaction by inserting a chip-based card into a payment terminal.



Further demonstrating frequent consumer misunderstanding about the nature of payment card fraud, 41% of respondents falsely believe debit cards offers better fraud protection than credit cards.